Provincially-mandated tax incentive programs have devastating effects on Island municipalities says Burpee-Mills reeve

EVANSVILLE—Burpee-Mills Reeve Ken Noland met with Kathryn McGarry, Minister of Natural Resources and Forestry (MNRF), earlier this week on the township’s concerns that due to lands acquired in the township (which then become tax exempt) by groups such as the Nature Conservancy of Canada (NCC), the township loses significant tax dollars every year.

“One of the points I made to the minister is that because the NCC gets tax exemptions for lands it has, the municipality does not receive any more revenues from these properties,” stated Reeve Noland. “The NCC can rent out their land for things like hunting and fishing purposes and the municipality receives nothing.”

In his presentation to the minister on the reduction of municipal tax revenue, Reeve Noland said, “provincially mandated tax incentive programs have a devastating reality to small Northern rural municipalities. These provincial programs, as presently administered, result in substantial erosion of annual municipal tax revenues to the point where it has become a critical fiscal issue for the municipality of Burpee and Mills.”

“The farmland tax program, managed forest tax program, and tax exempt status for (NCC) property resulted in a significant loss of taxation revenue for 2016 as follows: farmland, $49,549.99; managed forest, $8,490.20; and tax exempt nature conservancy, $8,130.11 for a total of $66,170.30,” explained Mr. Noland.

“The weighted assessment method for calculating payments saves the municipality approximately $20,000 resulting in a net loss of over $40,000 annually ($46,000),” said Reeve Noland. “During the last 10 years this loss has amounted to in excess of $400,000 (actual $460,000). This amount is equivalent to the entire tax revenue that our municipality collects in one year.”

“These provincially mandated programs benefit all Ontarians, but are financed solely by the affected municipalities,” pointed out Reeve Noland. “The number of properties eligible for reduced taxation continues to grow each year. For instance, Nature Conservancy of Canada has recently finalized purchase of an additional 400 acres in Burpee Township.”

“The one thing the Minister said is that the tax exemption is not automatic,” said Reeve Noland. “The province inspects these properties and if they find something (such as an endangered species of plant on the property) then the tax exemption can be granted, but I explained this isn’t entirely right because there is the program-the Great Lakes Heritage Coast—which Manitoulin falls in the middle of, and all groups like the NCC have to do is say is that Manitoulin is included in this program and they receive the tax exemption even if all the criteria isn’t met.”

“And the Ministry of Finance says compensation is provided to municipalities for properties that are tax exempt through the Ontario Municipal Partnership Fund. We receive very little if any funds, and there is still a large shortfall,” continued Reeve Noland.

Reeve Noland, on behalf of the township, proposed several recommendations to the minister including: reimbursing the municipality for 100 percent of lost tax revenue from the farmland tax incentive program; reimbursing the municipality for 100 percent of lost tax revenue from the managed forest tax incentive program; removing the tax exempt status for designated conservation groups or reimbursing the municipality for 100 percent of lost taxation revenue; and restricting any further tax exempt status of lands in the municipality of Burpee and Mills.

“I had requested a meeting with the Minister of Finance, the Minister of Agriculture, and Minister of Municipal Affairs and Housing along with the minister of Natural Resources and Forestry,” said Reeve Noland. The office for the Minister of Agriculture said that due to time restraints they couldn’t meet with me. The other two ministers never contacted or replied to our request. We never heard a word. At least those other ministers could have called and told go to hell, but I never heard a word.”

“The minister (Ms. McGarry) said he will look into the issue and provide the township a response,” said Reeve Noland.